The then Zamorin of Calicut ManavikramaEttan Raja had a celestial vision in the general health of his subjects. He wanted the knowledge and wisdom in Ayurveda acquired by the vaidyas, through ages of observation and learning to be made available to the common man when it was available only to the rich.

The British Government was much skeptic about Ayurveda and other Indian systems of medicine and they were reluctant to recognize its efficacy and purity. No measures were taken by the Government to promote indigenous medical systems.

A revolutionary decision was taken by the Zamorin of Calicut ManavikramaEttan Rajain the year 1902 to establish Samajam at Chalappuram in Kozhikode which was named as AryaVaidya Samajam". A patasala for teaching Ayurveda and a Pharmacy for the Preparation of Medicines were also started along with Samajam. The first meeting witnessed the presence of ManavikramaEttan Raja as the chief patron. The assemblage also included the presence of stalwarts like P.S Warrier, kavikulaguru PV Krishna Warrier , Punnasseri Nambi Neelakanda Sharma , Ambromoli Ravunni Vaidyar, Kuthiravattom Shankaran Thampan, KC Narayanan Namboothiri, Mooppil Nair, Chirackalramavarmailaya Raja, Thriprangottu Parameswaran Moossad, Venghayil Kunjiraman Nair. Thaikkat Ravi Mooss, Ollur kadavi Anthoni vaidyar and the like minded.

In the same period, with the same vision under the direction of the Prince of the State Cochin and the leadership of eminent Visha Vaidya Kochunni Thampuran established an Ayurvedic treatment centre at Thrissur. The two princely states in Kerala, the Kochi and the Malabar were always at enmity and their bone of contention was the loss of the 'Perumpadappu Swaroopam' of Kochi to the Zamorins of Malabar. They never met in peace but in war. A historic exception was made once when they met, not to discuss any princely or royal matters but to create an organization to serve the public on health related matters

In 1913 a general body meeting in Samajam was held in the Palakkad Native School and it was decided to register it under the Charitable Society Act. The AryaVaidya Samajam was renamed as Keraleeya Ayurveda Samajam and a decision made to shift the location from Chalapuram to Cheruthuruthy, the central destination between the two princely states of Kochi & Malabar. The first ever Ayurvedic Hospital for the general public in the world thus came into existence at Cheruthuruthy on the southern banks of river Nila. The land was given by the then Prince of Cochin and the Zamorin of Calicut with his followers conducted a luck draw to collect enough money for the further developments. In 1914 February 5, Inauguration of the Hospital was done in the presence of Madras Governor, Sir Arthur Lowely. The first ever administrative body of the Samajam was thus formed with Appan Thampuran as its first President.

The Zamorin insisted for the service of the eminent physicians and famous Ashta Vaidyas to form a "ChikitsaYogam", a panel of doctors and hence, the first ever panel was formed under the leadership of the legendary Thriprangode Parameswaran Mooss with Alathiyur Neelakantan Nambi, Chirattamen Narayanan Mooss, Kuttancherry Aryan Mooss, Thaikatt Divakaran Mooss, Mooriyil Narayanan Nambisan, Ambramoli Ravunni Vaidyar , Veyiloor Sanku Varrier and two allopathic Doctors - Dr.C.V Rama Rao and Dr. E. Rama Varrier. This process of consulting patients by the panel of doctors was re-introduced in the year 1990 and continues even today as its head office at Shoranur as well as in all other branches. Happily many institutions in modern times follow the Samajam Practice of starting a panel of physicians to discuss and find solutions to chronic ailments.

The attitude of the British Government towards Ayurveda changed when the Chief Justice of High Court , Sir Basil Scott , became bed ridden due to a chronic stomach pain and was cured by Ayurvedic treatments in the year 1911. He was advised about the effectiveness of Ayurveda by the Madras Governor; Sir ArthurLowely who later contacted Samajam through the Zamorin, Samajam Chief Physician TriprangodeParameswaranMooss was assigned to treat the Chief Justice. The Justice was astonished by the recovery from his chronic pain because he had misjudged Mooss's knowledge considering it sheer magic. Later Mooss explained and convinced the Justice that Ayurveda is a well-structured medical doctrine evolved after ages of research and application.

Extremely satisfied by the service of Mooss, Justice spoke to the Governor General to honour Mooss. That was the first ever "Vaidyaratnam" Title in South India and was conferred to Moossad by the Viceroy Lord Charles Hardinge. Ashtavaidyan Thaikkatt Narayanan Mooss of Samajam was given the second Vaidyaratnam and subsequently the third award was given to Shri. P. S Varier who was the first Secretary of Samajam.

In 1940, owing to some differences of opinion with the Cochin Diwan Shanmughan Chetti, the Samajam was shifted to the northern banks of the river Nila in Shoranur. There it flourished under the leadership of K. R Padmanabha lyer, Secretary who teamed up with the dynamic Rao Bahadur AV Govinda Menon, to give the Samajam the name and fame it enjoys now. Popular personalities viz former Prime Minister Gulsarilal Nanda, Governerors viz Sri. R. Prakasham, Sri. Subbarayan, former Chief Minister Kamaraja Nadar, eminent classical musician Chembai Vaidya Natha Bahagavathar, former Union Minister Shri. Subrahmaniam, Mahakavi Vallathol and Shri. Punnassery Neelakanda Sarmawere the members of Samajam in its early days.